Kirk W Posted January 18, 2023 Report Share Posted January 18, 2023 U.S. to hit debt limit Thursday: Here’s what that means Market Watch Jan. 17, 2023 Debt Ceiling Defined: What Is the U.S. National Debt Ceiling? Investopedia January 17, 2023 Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
RV_ Posted January 18, 2023 Report Share Posted January 18, 2023 Both good articles, thanks! Quote RV/Derekhttp://www.rvroadie.com Email on the bottom of my website page.Retired AF 1971-1998 When you see a worthy man, endeavor to emulate him. When you see an unworthy man, look inside yourself. - Confucius “Those who can make you believe absurdities, can make you commit atrocities.” ... Voltaire Link to comment Share on other sites More sharing options...
RV_ Posted January 21, 2023 Report Share Posted January 21, 2023 Quote RV/Derekhttp://www.rvroadie.com Email on the bottom of my website page.Retired AF 1971-1998 When you see a worthy man, endeavor to emulate him. When you see an unworthy man, look inside yourself. - Confucius “Those who can make you believe absurdities, can make you commit atrocities.” ... Voltaire Link to comment Share on other sites More sharing options...
Ray,IN Posted January 21, 2023 Report Share Posted January 21, 2023 The key to resolving this is fiscal responsibility, exactly like we run our household. What happens when we run up more debt than we can repay? Yup, not pretty. Quote 2000 Winnebago Ultimate Freedom USQ40JD, ISC 8.3 Cummins 350, Spartan MM Chassis. USA IN 1SG retired;Good Sam Life member,FMCA ." And so, my fellow Americans: ask not what your country can do for you--ask what you can do for your country. John F. Kennedy 20 Jan 1961 Link to comment Share on other sites More sharing options...
Kirk W Posted January 21, 2023 Author Report Share Posted January 21, 2023 RV, Brookings is one of the others that I considered posting. Thanks! Here is more food for thought. What Is the Debt Limit and What Happens If the US Defaults? When Congress passes a spending bill, they decide what the government will spend its revenue on. That revenue comes mostly from taxes, but also from things like customs duties at the border and the sale of natural resources, according to the U.S. Treasury's Fiscal Data website. Most of the time, the government doesn't have enough revenue on hand to pay for everything in those spending bills — such as infrastructure, social security, Medicare and defense. That's been the case since at least 2001, which was the last time the Treasury says more money was brought in than spent in a single year. And another to consider? Debt ceiling: 5 devastating consequences if Congress doesn’t raise or suspend the limit? 1. Government obligations such as Social Security or Medicare disbursements could be at risk 2. Buying a home, car or credit card borrowing could get more expensive. 3. Stock prices could sink, threatening companies’ bottom lines. 4. The government could default on its debt, triggering a recession, job losses and income disruptions for millions. 5. Even if the debt ceiling is raised in time, Americans could feel financial pain. Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
docj Posted January 21, 2023 Report Share Posted January 21, 2023 (edited) Here's a basic level article on the nature of the Federal deficit and corresponding debt. GDP growth is tightly tied to deficit spending; managing a country's economy is a lot more complicated than balancing your family's checkbook. https://www.investopedia.com/articles/economics/10/national-debt.asp Edited January 21, 2023 by docj Quote Sandie & Joel 2000 40' Beaver Patriot Thunder Princeton--425 HP/1550 ft-lbs CAT C-12 2014 Honda CR-V AWD EX-L with ReadyBrute tow bar/brake systemWiFiRanger Ambassador Follow our adventures on Facebook at Weiss Travels Link to comment Share on other sites More sharing options...
Ray,IN Posted January 21, 2023 Report Share Posted January 21, 2023 Docj that is a very interesting article. However nowhere does it explain what happens when some or all the national debt is called by the lenders. The author states it is indefinite, as the government goes on forever. Quote 2000 Winnebago Ultimate Freedom USQ40JD, ISC 8.3 Cummins 350, Spartan MM Chassis. USA IN 1SG retired;Good Sam Life member,FMCA ." And so, my fellow Americans: ask not what your country can do for you--ask what you can do for your country. John F. Kennedy 20 Jan 1961 Link to comment Share on other sites More sharing options...
Kirk W Posted January 21, 2023 Author Report Share Posted January 21, 2023 25 minutes ago, Ray,IN said: However nowhere does it explain what happens when some or all the national debt is called by the lenders. How would that ever happen? A major share of it is in bonds and treasury bills. Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
Kirk W Posted January 21, 2023 Author Report Share Posted January 21, 2023 https://fiscaldata.treasury.gov/ Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
Ray,IN Posted January 21, 2023 Report Share Posted January 21, 2023 (edited) After reading all the linked articles and many I've found using a search engine, the U.S.A. debt is a house of cards. The Federal Reserve owns 78% of the national debt, and stays afloat by printing money out of thin air. This of course is completely legal since U.S.A. currency is no longer based on gold or silver. I suppose we could run a family like this, borrow from your wife and each child to spend more money than we have, with the expectation of never repaying anyone; but in the beginning we gave them the money, so we'd have to print more money to be able to borrow from them, however that is illegal for all except the federal government. I find this very interesting: "Intragovernmental Debt The Treasury owes this part of the debt to other federal agencies. Intragovernmental holdings totaled more than $6.89 trillion in January 2023.1 Why would the government owe money to itself? Because some agencies, like the Social Security Trust Fund, take in more revenue from taxes than they need. These agencies then invest in U.S. Treasurys rather than stick this cash under a giant mattress, source: https://www.thebalancemoney.com/who-owns-the-u-s-national-debt-3306124 This transfers the agencies' excess revenue to the general fund, where it's spent. They redeem their Treasury notes for funds as needed. The federal government then either raises taxes or issues more debt to raise the required cash. Japan holds $1.3 trillion in U.S.A. debt; China holds $1.1 trillion. Sure that is a small fraction of $31 trillion, but what happens if they call that debt?https://finmasters.com/who-owns-the-us-national-debt/ This entire thread is quite useless, as nothing we can do will make a difference. It is all ran by what some refer to as the shadow government. An interesting fact I came across during searches is this: Which President is responsible for the highest percentage increase in national debt? https://www.self.inc/info/us-debt-by-president/ Edited January 21, 2023 by Ray,IN Quote 2000 Winnebago Ultimate Freedom USQ40JD, ISC 8.3 Cummins 350, Spartan MM Chassis. USA IN 1SG retired;Good Sam Life member,FMCA ." And so, my fellow Americans: ask not what your country can do for you--ask what you can do for your country. John F. Kennedy 20 Jan 1961 Link to comment Share on other sites More sharing options...
Dutch_12078 Posted January 22, 2023 Report Share Posted January 22, 2023 8 hours ago, Ray,IN said: After reading all the linked articles and many I've found using a search engine, the U.S.A. debt is a house of cards. The Federal Reserve owns 78% of the national debt, and stays afloat by printing money out of thin air. This of course is completely legal since U.S.A. currency is no longer based on gold or silver. I suppose we could run a family like this, borrow from your wife and each child to spend more money than we have, with the expectation of never repaying anyone; but in the beginning we gave them the money, so we'd have to print more money to be able to borrow from them, however that is illegal for all except the federal government. I find this very interesting: "Intragovernmental Debt The Treasury owes this part of the debt to other federal agencies. Intragovernmental holdings totaled more than $6.89 trillion in January 2023.1 Why would the government owe money to itself? Because some agencies, like the Social Security Trust Fund, take in more revenue from taxes than they need. These agencies then invest in U.S. Treasurys rather than stick this cash under a giant mattress, source: https://www.thebalancemoney.com/who-owns-the-u-s-national-debt-3306124 This transfers the agencies' excess revenue to the general fund, where it's spent. They redeem their Treasury notes for funds as needed. The federal government then either raises taxes or issues more debt to raise the required cash. Japan holds $1.3 trillion in U.S.A. debt; China holds $1.1 trillion. Sure that is a small fraction of $31 trillion, but what happens if they call that debt?https://finmasters.com/who-owns-the-us-national-debt/ This entire thread is quite useless, as nothing we can do will make a difference. It is all ran by what some refer to as the shadow government. An interesting fact I came across during searches is this: Which President is responsible for the highest percentage increase in national debt? https://www.self.inc/info/us-debt-by-president/ You ask what happens if Japan and Chine were to "call that debt"? Actually pretty much nothing good for their countries. Countries hold US debt for one reason, it's the safest most stable investment in the world, and they use the US Treasury warrants they hold in part to stabilize their own currencies by keeping the US dollar strong. Keeping the value of their currencies below the US dollar helps them promote exports that boost their economies. The bottom line though, is any time one country sells off some of it's US Treasury holdings, other countries snap it up to keep the US dollar stable in the market place. Quote Dutch 2001 GBM Landau 34' Class A F-53 Chassis, Triton V10, TST TPMS 2011 Toyota RAV4 4WD/Remco pump ReadyBrute Elite tow bar/brake system Link to comment Share on other sites More sharing options...
Kirk W Posted January 22, 2023 Author Report Share Posted January 22, 2023 (edited) Debt Ceiling Showdown: What Investors Need To Know FORBESMONEYWEALTH MANAGEMENT Jan 22, 2023 While there have been several contentious past debt ceiling increases, this upcoming negotiation could be pretty noxious. Disagreement among Republicans on the need for spending cuts, a narrow House majority, and Democratic control of the Senate and Presidency seem likely to complicate attempts to reach a deal. In any case, it should not be expected to be a straightforward process this time. Typically, additional uncertainty does not benefit the stock market’s performance, so it is instructive to look at past instances of debt ceiling negotiations. In 2011, the U.S. began using extraordinary measures to service the debt on May 16, reaching an agreement on August 2. During that period, the S&P 500 fell almost -6%. It is unlikely that the debt ceiling was the only reason for the decline, as Europe was mired in a debt crisis, and economic growth was slowing. Standard & Poor’s downgraded U.S. sovereign debt one notch from the top level of AAA, even though there was no default in 2011. In 2013, extraordinary measures were started on May 13, and an agreement was reached on October 17. During this period, the S&P 500 was almost 4% higher though stocks were down nearly -6% at one point. Edited January 22, 2023 by Kirk W Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
docj Posted January 22, 2023 Report Share Posted January 22, 2023 22 hours ago, Ray,IN said: After reading all the linked articles and many I've found using a search engine, the U.S.A. debt is a house of cards. The Federal Reserve owns 78% of the national debt, and stays afloat by printing money out of thin air. This of course is completely legal since U.S.A. currency is no longer based on gold or silver. I suppose we could run a family like this, borrow from your wife and each child to spend more money than we have, with the expectation of never repaying anyone; but in the beginning we gave them the money, so we'd have to print more money to be able to borrow from them, however that is illegal for all except the federal government. The difference between the US debt and the debt of any kind of business is the assumption that the government will always be there to pay its obligations. A company that couldn't meet its bond payments might try to float some additional securities but there would probably be few takers. As long as the US federal debt is considered 100% secure there are plenty of people who will buy it, even if the government is simply more money to pay its bills. That's because there are two underlying assumptions--1. A 100% expectation that the debt will get paid; 2. That the US economy will continue to grow to support increased tax revenues which will enable such repayment. If either f these underlying assumptions fail then there will be fewer people (or countries) willing to invest in US securities which is why uncertainty over the debt ceiling can have significant consequences. Quote Sandie & Joel 2000 40' Beaver Patriot Thunder Princeton--425 HP/1550 ft-lbs CAT C-12 2014 Honda CR-V AWD EX-L with ReadyBrute tow bar/brake systemWiFiRanger Ambassador Follow our adventures on Facebook at Weiss Travels Link to comment Share on other sites More sharing options...
BusDreamer Posted January 22, 2023 Report Share Posted January 22, 2023 When I see these discussions I wonder, but can't find, what the US debt balance is vs GDP over past 40 is years. Or some other measure that would compare the debt in inflation adjusted terms. Some economic theories suggest government debt don't matter as it promotes growth. This has been debated like gas vs diesel or Chevy vs Ford. Quote Link to comment Share on other sites More sharing options...
Kirk W Posted January 22, 2023 Author Report Share Posted January 22, 2023 Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
usbusin Posted January 22, 2023 Report Share Posted January 22, 2023 The vertical line in 2020 is interesting. Quote 2001 Freightliner FL70, Cat 3126b 300hp, 860 lb/ft, 6 speed manual Eaton/Fuller Motorhome body by Transport Designs (37 ft overall) Motorhome Specs and Pictures Our Music Ministry Link to comment Share on other sites More sharing options...
Ray,IN Posted January 23, 2023 Report Share Posted January 23, 2023 (edited) 7 hours ago, BusDreamer said: When I see these discussions I wonder, but can't find, what the US debt balance is vs GDP over past 40 is years. Or some other measure that would compare the debt in inflation adjusted terms. Some economic theories suggest government debt don't matter as it promotes growth. This has been debated like gas vs diesel or Chevy vs Ford. https://tradingeconomics.com/united-states/government-debt-to-gdp Here is the debt to GDP for all countries: https://worldeconomics.com/Debt/ I noted, as that percentage declines so does the standard of living. IMO the U.S.A. is living in a bubble, will it break? Then there is the congressional millionaires club that oversees the national debt. Edited January 23, 2023 by Ray,IN Quote 2000 Winnebago Ultimate Freedom USQ40JD, ISC 8.3 Cummins 350, Spartan MM Chassis. USA IN 1SG retired;Good Sam Life member,FMCA ." And so, my fellow Americans: ask not what your country can do for you--ask what you can do for your country. John F. Kennedy 20 Jan 1961 Link to comment Share on other sites More sharing options...
RV_ Posted January 24, 2023 Report Share Posted January 24, 2023 On 1/22/2023 at 12:03 PM, Kirk W said: If debt is an issue you do need to look at states. Which states pay the most federal taxes and who pays the least in the federal tax base. Then which states get the most federal handouts, take the most in federal funding. IT seems to be that the states that tout smaller government and no federal interference are also the ones who take the most in federal aid and pay in the least. Here is a great chart for that: Quote RV/Derekhttp://www.rvroadie.com Email on the bottom of my website page.Retired AF 1971-1998 When you see a worthy man, endeavor to emulate him. When you see an unworthy man, look inside yourself. - Confucius “Those who can make you believe absurdities, can make you commit atrocities.” ... Voltaire Link to comment Share on other sites More sharing options...
Kirk W Posted January 24, 2023 Author Report Share Posted January 24, 2023 10 hours ago, RV_ said: Here is a great chart for that: The chart would be much better if there was some explanation, or better yet a link to the source? In looking for your chart and information on it, I did a Google search on "which states get the most federal handouts" and found some very interesting sites. One of the more interesting features is that they do not all agree, although there does seem to be a pattern. You really need to look at several such reports and study how they arrive at the numbers. States Most Dependent on the Federal Government Image is a table by SmartAsset titled "States Most Dependent on the Federal Government." Page 1 of 5 Table with 5 columns and 50 rows. Currently displaying rows 1 to 10. Rank State Federal Share of State Revenue Ratio of Federal Funding to Income Taxes Paid Percent of Workers Employed by Federal Government 1 West Virginia 45.16% 2.36 4.08% 2 New Mexico 41.80% 1.87 6.06% 3 Mississippi 47.31% 2.53 3.23% 4 Alabama 41.20% 1.25 3.33% 5 Alaska 50.83% 1.62 6.83% 6 Idaho 41.08% 0.91 2.75% 7 Louisiana (Tie) 52.27% 1.60 2.13% 7 Maine (Tie) 43.27% 1.19 2.31% 9 Wyoming 56.43% 1.36 3.37% 10 Montana 46.58% 1.04 3.54% Federal Aid by State 2023 The ten states with the highest total federal funding are: California ($43.61 billion) Texas ($26.90 billion) Florida ($23.77 billion) New York ($22.06 billion) Virginia ($17.68 billion) Pennsylvania ($15.58 billion) Illinois ($13.18 billion) Ohio ($12.57 billion) North Carolina ($11.31 billion) Michigan ($10.84 billion) Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
RV_ Posted January 24, 2023 Report Share Posted January 24, 2023 (edited) Kirk the article link and the website have a lot of other great visualizations too: "HowMuch.net, a financial literacy website" https://howmuch.net/articles/federal-budget-receipts-and-expenditures-across-the-united-states Edited January 24, 2023 by RV_ Quote RV/Derekhttp://www.rvroadie.com Email on the bottom of my website page.Retired AF 1971-1998 When you see a worthy man, endeavor to emulate him. When you see an unworthy man, look inside yourself. - Confucius “Those who can make you believe absurdities, can make you commit atrocities.” ... Voltaire Link to comment Share on other sites More sharing options...
Kirk W Posted January 24, 2023 Author Report Share Posted January 24, 2023 1 hour ago, RV_ said: the article link and the website have a lot of other great visualizations too: Thank you and that is a very interesting site. I'm bookmarking it. ☺️ For the graph you posted, here is the legend that I wasn't sure about. Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
Kirk W Posted January 24, 2023 Author Report Share Posted January 24, 2023 One thing that isn't reflected by the various figures for federal money to each state is what the source of that money is. Many of the western states have a lot of their land under federal ownership and a lot of minerals are taken out by a federal mineral lease and so a major share of those royalty payment are returned to the states that those minerals came from. The only extensive article on this that I can find is from 2013 but here is a link to it as it is interesting and answers part of the question of why some states get such large amounts of federal money. Federal Mineral Royalty Disbursements to States May 30, 2013 This one is more current on the disbursements to the states but is petroleum only. Federal Fossil Fuel Disbursements to States Quote Good travelin !...............KirkFull-time 11+ years...... Now seasonal travelers.Kirk & Pam's Great RV Adventure Link to comment Share on other sites More sharing options...
Ray,IN Posted January 25, 2023 Report Share Posted January 25, 2023 Apparently UT wins that pie chart easily. Indiana looks to be a distant 4 place. Quote 2000 Winnebago Ultimate Freedom USQ40JD, ISC 8.3 Cummins 350, Spartan MM Chassis. USA IN 1SG retired;Good Sam Life member,FMCA ." And so, my fellow Americans: ask not what your country can do for you--ask what you can do for your country. John F. Kennedy 20 Jan 1961 Link to comment Share on other sites More sharing options...
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